Central States going broke---

[Bubblehead]

.....certainly we aren't suggesting that these people should have planned on the notion that their pension would fail.

Are you making similar contingency plans for when your 401K fails due to federal oversight or reform?

 

[IVE GOTTA PACKAGE 4U]

Many retirees believe they did just that, while correctly assuming their pension was an earned benefit.

....only to have that rug pulled out from under them, with no recourse or ability to earn.

It is not their fault and absolutely criminal in my opinion.

Life isn't fair
And yes it does suck

 

[BigUnionGuy]

I thought this issue had been discussed "ad nauseam" but I was wrong.

And yes, the deregulation of the trucking industry was certainly the instrumental catalyst.


UPS wanted out in 1993.

Fast forward to 2007 and they got their wish.

But, the 6.4 Billion they paid (for their withdraw liability) went "poof" because of the economic downturn in 2008.


So this is where we are at;


I sympathize with @rod and thousands of other Teamsters.

The reality is, pension plans can't support people collecting a pension for more years than they worked.


Others will say.... the Union has failed for not organizing in a core industry like LTL freight.

Good luck with that. You've probably never even gauged the interest of people working in that industry.


Others will say.... It is Hoffa's fault and with a change of leadership things will be different.

Nonsense.


It would take the influx of thousand and thousands of new members to "shore up" any multi-employer fund.

People aren't knocking at the door to join (any) Union. These are the times we live in.


It's going to take Federal relief to help (all) multi-employer pension plans.

Either that.... or they will have to bail out the PBGC.



-Bug-

 

[Staydryitsraining]

How long has this problem been going on?

Since the beginning of time

 

[Wally]

So they had 13 years now to make cuts, increase funding, and extend retirement age.

Did any of that happen?

 

[BigUnionGuy]

So they had 13 years now to make cuts, increase funding, and extend retirement age.

Did any of that happen?

Sort of.

In 2002 they reduced the accrual rate from 2% to 1% and for new, or renegotiated contracts, there was a certain

minimal percentage that had to be negotiated. Can't remember the numbers right now. Extending the retirement

age would be a long term addition. But when you have all the "orphans" from defunct companies and a

4-1 ratio of retiree vs active.... it's only a matter of time.

 

[Wally]

Sort of.

In 2002 they reduced the accrual rate from 2% to 1% and for new, or renegotiated contracts, there was a certain

minimal percentage that had to be negotiated. Can't remember the numbers right now. Extending the retirement

age would be a long term addition. But when you have all the "orphans" from defunct companies and a

4-1 ratio of retiree vs active.... it's only a matter of time.

Sounds like that was not enough. At least 5 years of work time should have been added. Current payouts should have been cut. Spread thr pain.

 

[oldngray]

Sort of.

In 2002 they reduced the accrual rate from 2% to 1% and for new, or renegotiated contracts, there was a certain

minimal percentage that had to be negotiated. Can't remember the numbers right now. Extending the retirement

age would be a long term addition. But when you have all the "orphans" from defunct companies and a

4-1 ratio of retiree vs active.... it's only a matter of time.

Letting those companies get away with not paying what they owed for the orphans was possibly the biggest hit to the plan.

 

[BigUnionGuy]

Letting those companies get away with not paying what they owed for the orphans was possibly the biggest hit to the plan.

Absolutely.

But after closing their doors, the pension obligations were probably last in line behind all the creditors.

 

[Wally]

Letting those companies get away with not paying what they owed for the orphans was possibly the biggest hit to the plan.

Those not paying should have been separated into their own fund. It's a pension fund, not welfare. Once you stop paying, you are out.

 

[Overpaid Union Thug]

These threads are another example of why it’s silly for career UPSers to continue to give Amazon their business. The more products you impulse buy on Amazon means the bigger they grow and the more we don’t. Amazon hiring more people doesn’t put more money in our pension funds.

 

[Inthegame]

Sounds like that was not enough. At least 5 years of work time should have been added. Current payouts should have been cut. Spread thr pain.

As previously stated, the UPS withdrawal payment of 6+ billion dollars put the plan in "green" zone status (+80% funded). But then the 2008 recession happened and it became abundantly clear the CSPF would fail without cuts.

In 2010, the administrators of the CSPF proposed a 10% reduction to save the plan and urged Congress to pass legislation to make that possible as cutting "payouts" wasn't a legal option under ERISA. Unfortunately the quick acting Congress did not address the issue until they finally passed the MPRA act in Dec 2014 , which allowed troubled plans to reduce benefits but only with consent from participants, and approval from the Treasury dept.

The CSPF administration then proposed a more drastic Rescue Plan that was rejected by the Treasury dept. as insufficient to address the impending bankruptcy.

Ironically, retirees who lobbied against that Rescue Plan cheered the rejection as a victory and now face even more drastic cuts.

 

[rod]

Nah, those old people had their time. It's time to move along. We can't keep supporting them.

We aren’t good at moving along. Just ask Upstate

 

[BigUnionGuy]

Unfortunately the quick acting Congress did not address the issue until they finally passed the MPRA act in Dec 2014 , which allowed troubled plans to reduce benefits but only with consent from participants, and approval from the Treasury dept.

If I am not mistaken, that's what happened with the Upstate Ny fund.

And what a shock.... member participation in the vote was embarrassingly low.

 

[Wally]

As previously stated, the UPS withdrawal payment of 6+ billion dollars put the plan in "green" zone status (+80% funded). But then the 2008 recession happened and it became abundantly clear the CSPF would fail without cuts.

In 2010, the administrators of the CSPF proposed a 10% reduction to save the plan and urged Congress to pass legislation to make that possible as cutting "payouts" wasn't a legal option under ERISA. Unfortunately the quick acting Congress did not address the issue until they finally passed the MPRA act in Dec 2014 , which allowed troubled plans to reduce benefits but only with consent from participants, and approval from the Treasury dept.

The CSPF administration then proposed a more drastic Rescue Plan that was rejected by the Treasury dept. as insufficient to address the impending bankruptcy.

Ironically, retirees who lobbied against that Rescue Plan cheered the rejection as a victory and now face even more drastic cuts.

Oops! They gambled and lost.

 

[Darmark7]

Just got an Email from Central States stating that there are only 48 more months left before my pension plan goes broke. To be honest that is longer than I expected so I will take it as good news.

Don’t worry Biden has got a plan to not only give Americans free everything but the rest of the world if they can just cross the boarder! Plus free money every month just to stay home! Also $100 trillion for the New Green Deal! Biden knows where all the money Trump stole is! The whole world is going to be Utopia! Don’t believe me just ask a Biden/Harris supporter. No more sickness, poverty, racism, police violence or any other troubling things. See nothing to be concerned about after Jan 20 2021.

 

[Big Rigger]

As previously stated, the UPS withdrawal payment of 6+ billion dollars put the plan in "green" zone status (+80% funded). But then the 2008 recession happened and it became abundantly clear the CSPF would fail without cuts.

In 2010, the administrators of the CSPF proposed a 10% reduction to save the plan and urged Congress to pass legislation to make that possible as cutting "payouts" wasn't a legal option under ERISA. Unfortunately the quick acting Congress did not address the issue until they finally passed the MPRA act in Dec 2014 , which allowed troubled plans to reduce benefits but only with consent from participants, and approval from the Treasury dept.

The CSPF administration then proposed a more drastic Rescue Plan that was rejected by the Treasury dept. as insufficient to address the impending bankruptcy.

Ironically, retirees who lobbied against that Rescue Plan cheered the rejection as a victory and now face even more drastic cuts.

Thank you for that. We saw that go down. Expect the unexpected.

 

[Bubblehead]

But when you have all the "orphans" from defunct companies and a

4-1 ratio of retiree vs active.... it's only a matter of time.

If a proportionate ratio of retiree vs active members is necessary to sustain a healthy pension fund,

....that sounds like a ponzi scheme to me.

 

[BigUnionGuy]

If a proportionate ratio of retiree vs active members is necessary to sustain a healthy pension fund,

....that sounds like a ponzi scheme to me.

Totally agree.

The problem with the 4-1 ratio is, you'll never get returns on investments high enough to make up the shortfall.

If I remember correctly, after the reduction of the accrual rate in 2002, all re-negotiated contracts had to have

an increase in pension contributions of at least 8%.... or the IBT wouldn't approve the contract being voted on.

 

[What'dyabringmetoday???]

If I am not mistaken, that's what happened with the Upstate Ny fund.

And what a shock.... member participation in the vote was embarrassingly low.

Quick question- do you think the vote count was legitimate with the 2020 Presidential Election? Take your time with your response....lol.